IRS & Your Coins

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Try trading. Barter is the only real way to beat the IRS. The dollar is the unit of account of the US Government. You pay for the privledge of using this unit of account by paying taxes. As things get worse I see a whole market getting started of barter trade. A plumber may charge you $500 for work but might accept a quarter ounce of gold instead.

 

I'm no tax guy but I believe President Reagan had the IRS tax bartering, tips and such.

 

You may want to consult a tax professional before going forward with your theory... FYI, basically you're taxed on the gains realized on any sale OR exchange (aka trade).

 

I would guess your friend has told you to hang on to every invoice.
Without it, you will owe taxes on any amount above face value.

I'm going to let my son deal with the taxes when I'm gone.
He will pay much less than I would if I were to sell today.

 

As I understand it, banks, etc. have to file a form when there is a cash transaction of $10,000 or more. If the bank, etc. suspects money laundering or attempts to evade the $10,000 limit (e.g., by buying two $9,000 money orders), they are supposed to file that form for amounts below $10,000.
I understand it, cash transactions that total $10,000 or more when totaled over a calendar year require filing a form. Thus if you have three $4,000 cash transactions during the year to the same coin dealer, he/she is supposed to file the form.

It seems to me that TPG records are a poor way for the IRS to infer income. Now if, because of court action (divorce, bankruptcy, your name is Bernie Madoff), an agency wants to determine net worth, then TPG records would be one way of determining your holdings.
However, the court/agency would have to believe that you have significant numismatic holdings that you haven't declared. The court/agency most likely would need a court order requiring the TPG's to list what coins you have had graded. While some TPG's (e.g., PCGS) do have an associated value for graded coins, not all do. The court/agency would then have to determine that the coin(s) are still under your control.

The present federal tax code does not tax personal possessions, only income that exceeds allowable expenses. Too much of this tread infers that the IRS is going to shortly go on a paranoid witch hunt to track down each of our coin collections and tax them bases solely on their value. Do I see the start of an urban legend here?

 

Indeed, bartering is a taxable.

Every scrap and chit.

 

It seems like the government collects every other type of tax without all this paperwork BS...such as sales tax, gas tax, property tax, liquor tax, cigarette tax, etc, etc, etc...).

I find it interesting that tax preparers (or folks who advertise that they can "fix" tax problems) prominently state "...we have the largest staff of former IRS agents"...now what message is that designed to convey?

It says (to me)..."we know what the IRS is looking for and what they will audit. Hire us and we'll show you all the deductions that will slip under the IRS radar."

There's a huge underground economy in the US of people that never pay income tax. There's got to be a better way...:loud:

 

There is indeed (a) deduction(s) for sales tax, gas tax, property tax, etc... And keeping paperwork pursuant to those taxes help when it comes to paying Federal and (in some states) State income tax. I do not believe, though, that the sin taxes you mentioned are applicable.

 

I realize the income tax has deductions for some of these other taxes...but that's not the point I'm trying to make. Do you fill out forms each year to ensure you're paying the proper sales tax? ...no. how about gas tax? ...nope.

It's only income tax where the government withholds an excessive amount of money and requires the individual (or their representative) to stay up on current law so they can get back the money they shouldn't have paid in the first place.

If you have too little withholding...penalty! If you have too much withholding...penalty! If you don't pay the penalty...interest and more penalty!

It's a jacked up system and it doesn't have to be like this. Now they're talking about a VAT tax; not as a replacement for income tax, but "in addition to" income tax. :rolling:

 

It sucks. Yes.

The only option in the long run, perhaps, is to become an ex-pat in a more tax-friendly country. I've given thought to it, for more reasons than just the taxes, but obviously such an idea requires in depth research into the practicality of the matter.

 

yakpoo, as a consumer you don't keep records of the sales tax paid because technically you are not responsible for paying any sales taxes.

The way it works is that the business is the entity responsible for keeping track of all of their sales and then paying a tax on those sales (the sales tax). Just so happens that almost all businesses pass that sales tax on to their customers. And yes, business do have to file sales tax returns with the state, sometimes annually and sometimes more frequently depending on their level of sales.

 

As the "consumer" I do know there was a deduction for it (2005-2009). As for 2010 and beyond, I am unaware whether Congress has extended it.

 

Even ex-patriots pay taxes above the 2555 exemption (whatever that is today...and it can always change). I'm not against paying my fair share of taxes...I pay a lot more than most. It's all the paperwork that I detest.

...and when did the tax code become a vehicle for social engineering, anyway. I don't see that mentioned in the 16th Amendment.

Worse than that, politicians now openly campaign for votes by saying that "if elected" they will increase taxes on one group of Americans and pay it to another group...in exchange for their votes. That's just plain wrong!

I served in the US military to ensure that never happens in this country...yet, there it is.

 

That is correct, though as a California resident I tend to forget that... You are permitted to deduct the greater of the sales tax which businesses collect from you OR the state income taxes you pay. Since CA income taxes are so high, it almost always exceeds the sales taxes paid. Though even if you do take the state income tax deduction, you can still deduct certain sales taxes in addition such as on a new car purchase.

If you do take the sales tax deduction though you better believe you need to be keeping records of it (unless you just use the IRS amount provided based on your income).

 

Not trying to get political, but you may know that over 50% of Americans pay absolutely zero income taxes each year!! So, the politicians are pretty much free to tax the heck out of all taxpayers since there is a majority which is untaxed that could theoretically keep all of the incumbents in office no matter how much they tax us taxpayers.

And thanks for your service :thumb:

 

edited

 

Ex-pat either in one of two ways: above the 2555 exemption, or more drastically, renounces [for non-tax] reasons.

 

I see where you are talking about on the forms, but I am talking about a different deduction pertinent to sales taxes allowable via schedule.

 

You are getting political. And I disagree. And I'll say this too, companies and corporations pay their share of taxes pursuant to tax law. And it is my opinion that if they (edited) keep jerking companies and corporations around, as well as "the greedy rich people", these companies will continue to move their operations, factories, workforces, and headquarters off shore, as well as all of the "rich greedy people" will continue to emigrate the heck out of the U.S.